Lobe Sciences Ltd. Announces Private Placement to Support Drug Development of Novel Conjugated Psilocin(TM)

Rhea-AI Summary

Lobe Sciences (LOBEF) has announced a significant private placement through its newly created subsidiary Cynaptec Pharmaceuticals. The deal includes an initial US$6 million investment and an additional US$20 million option, potentially totaling US$26 million.

Cynaptec will own and develop the company's Conjugated Psilocin™ technology, receiving worldwide patents and related IP from Lobe Sciences in exchange for 6,399,900 shares of Common Stock. The initial placement involves issuing 3,600,000 Series A-1 Preferred Stock shares at US$1.66 per share.

The funding will support preclinical research, Phase 1, and Phase 2a clinical studies, with the optional US$20 million designated for Phase 3 clinical trials in chronic cluster headache treatment. Post-investment, Lobe Sciences retains 64% ownership of Cynaptec, which could decrease to 32% if the investor fully exercises their option within 120 days following completion of specific clinical milestones.

Positive

• Secured substantial initial funding of US$6M for clinical development
• Additional US$20M option available for Phase 3 trials
• Retains 64% ownership in Cynaptec after initial investment
• Clear development pathway through Phase 3 clinical trials
• Strategic spinout of IP assets into dedicated subsidiary

Negative

• Potential significant ownership dilution to 32% if US$20M option exercised
• Option exercise contingent on achieving specific clinical milestones
• Additional funding may be needed beyond Phase 3 trials

• Private Placement of US$6 Million to fund additional pre-clinical research, Phase 1 and Phase 2a clinical studies

• US$20 Million additional option included in Private Placement to fund the Phase 3 clinical program in chronic cluster headache

• Lobe creates Cynaptec Pharmaceuticals, Inc. which will own and develop Conjugated Psilocin ^TM

VANCOUVER, BC / ACCESS Newswire / April 14, 2025 / Lobe Sciences Ltd. ("Lobe Sciences" or the "Company") (CSE:LOBE)(OTCQB:LOBEF)(FWB:LOBE.F) a commercial stage biopharmaceutical company focused on using lipid technology to develop products to treat diseases with significant unmet medical needs, announced today a non-brokered private placement of preferred shares in the capital of Lobe Sciences' newly created subsidiary Cynaptec Pharmaceuticals, Inc. ("Cynaptec") for an initial gross proceeds of US$6,000,000 (the "Private Placement"). In connection with the Private Placement, the investor holds an exclusive option to purchase additional preferred shares for gross proceeds of up to US$20,000,000. The total gross proceeds, if the option is fully exercised, would total US$26,000,000.

Cynaptec is a newly created private Delaware corporation which will own and develop the Company's novel drug development candidate Conjugated Psilocin^TM. Lobe Sciences previously announced its intention to spinout Conjugated Psilocin^TM to Alera Pharma, Inc., another subsidiary of the Company.

Lobe has now successfully achieved the spinout of Conjugated Psilocin^TM to Cynaptec and proceeds from the Private Placement secures funding for Conjugated Psilocin^TM to be advanced in accordance with its development plan.

Accordingly, Lobe Sciences has transferred to Cynaptec (i) worldwide patents, applications, know-how and other intellectual property covering technology related to Conjugated Psilocin^TM and (ii) related commercial contracts (collectively, the "Transferred IP"). In consideration for the Transferred IP, Cynaptec issued to Lobe Sciences 6,399,900 shares of Common Stock of Cynaptec. Furthermore, Cynaptec and Lobe Sciences entered into a shared services agreement pursuant to which Lobe Sciences will provide to Cynaptec certain administrative services, regulatory affairs services and financial services.

Pursuant to the Private Placement, Cynaptec issued to the investor 3,600,000 shares of Series A-1 Preferred Stock (the "Preferred Shares"), USD$0.01 par value per share, at a purchase price of USD$1.66 per share. The Preferred Shares (i) are entitled to a dividend if and when declared on the Common Stock, (ii) have preference to the Common Stock as it relates to the proceeds from any liquidation, dissolution or winding up of Cynaptec, (iii) are entitled to price-based anti-dilution adjustment protection, and (iv) are initially entitled to exclusively vote for 2 of the 5 members of the board of directors of Cynaptec, as well as other rights generally accorded to preferred stockholders in an early-stage financing. Immediately following the Private Placement, Lobe Sciences owns 64% of the issued and outstanding shares of capital stock of Cynaptec. If the option is fully exercised by the investor, the investor would own 68% of the issued and outstanding shares of capital stock of Cynaptec. The aforementioned option is exercisable by the investor within 120 days following (i) Cyntaptec's completion of preclinical and Phase 1 Single Ascending Dose ("SAD") programs, as well as a Proof of Concept study ("POC") to determine if Conjugated PsilocinTM impacts headache frequency, intensity or duration; and (ii) the investor's receipt of final study reports for the SAD programs and the POC for Chronic Cluster Headaches and the investigational new drug enabling studies. The proceeds of the Private Placement will be used to fund additional preclinical research (including IND enabling studies), Phase 1 and Phase 2a clinical studies for Cynaptec's proprietary novel Conjugated Psilocin^TM. The funds from the additional option up to USD$20M would be used to support the Phase 3 clinical program in the orphan indication for Chronic Cluster Headache.

NEITHER THE CANADIAN SECURITIES EXCHANGE NOR ITS REGULATION SERVICES PROVIDER HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS NEWS RELEASE.

About Lobe Sciences, Ltd. (CSE: LOBE), (OTCQB: LOBEF), (FWB: LOBE.F) - Lobe Sciences is a biopharmaceutical company focused on using lipid technology to develop innovative treatments for orphan and rare diseases. Lobe Sciences commercializes Altemia® MF, a medical food designed to manage deficiencies commonly found in sickle cell disease. Additionally, through Cynaptec, Lobe Sciences retains an interest in developing Conjugated Psilocin^TM in neurology and psychiatric indications. Alera Pharma, Inc. remains a wholly owned subsidiary of the Company that Lobe Sciences may elect to utilize for future activity unrelated to Conjugated Psilocin^TM.

About Cynaptec Pharmaceuticals, Inc. - Cynaptec is a biopharmaceutical company dedicated to developing innovative therapies for neurological and psychiatric disorders. Cynaptec's initial development program is focused on the use of its proprietary Conjugated Psilocin^TM compound for treatment of the significant unmet medical needs of patients with Chronic Cluster Headache, with an additional preliminary proof-of-concept to assess potential utility for substance use disorders.

About Conjugated Psilocin^TM- Conjugated Psilocin^TM is a novel, patented, oral, stable analog of psilocin, the active metabolite of the prodrug psilocybin, designed to enhance bioavailability and therapeutic efficacy, which has been identified as having therapeutic potential in a variety of neurological conditions. Whereas conventional psilocin is an unstable compound that has been challenging for the industry to develop as a standalone pharmaceutical, Conjugated Psilocin's™ stability and bioavailability profile, and associated safety and efficacy signals, suggest the potential for prescription drug development in a variety of neurological and psychiatric indications.

Dr. Fred D. Sancilio, CEO
Lobe Sciences Ltd.

Investor and Media
Info@Lobesciences.com
www.lobesciences.com

Cautionary Statement Regarding "Forward-Looking" Information

This news release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. All statements in this news release, other than statements of historical facts, including statements regarding future estimates, plans, objectives, timing, assumptions or expectations of future performance, including, without limitation: the Company's intention to raise funds for clinical trials, the innovativeness of Conjugated Psilocin^TM. the anticipated focus and timing or efficiency of the Company's research and development activities; the potential for the Company's products to meet unmet medical needs, the anticipated use of proceeds from the offering, the intended development plans for Cynaptec, the intention of Lobe Sciences to provide certain services to Cynaptec, the potential exercise of the option and intended use of proceeds therefrom and the potential ability to raise funds for clinical development are forward-looking statements and contain forward-looking information. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as "intends" or "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should" or "would" or occur.

Forward-looking statements are based on certain material assumptions and analysis made by the Company and the opinions and estimates of management as of the date of this press release, including, among other things, that: the Company's planned activities will be able to create shareholder value and address serious unmet medical needs; the Company will continue to pursue its planned research and development activities, and that the Company will be able to raise funds among others. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Important risks that may cause actual results to vary, include, without limitation, the risk that: the Company's planned activities will be unable to create shareholder value or address the targeted unmet medical needs; the Company is unable to obtain the desired results from its current research and development activities; and the Company is unable to raise funds or to do so on the timelines anticipated.

Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Readers are cautioned that reliance on such information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking statement, forward-looking information or financial out-look that are incorporated by reference herein, except in accordance with applicable securities laws.

SOURCE: Lobe Sciences Ltd.

View the original press release on ACCESS Newswire

FAQ

What is the total potential value of Lobe Sciences (LOBEF) private placement deal?

The total potential value is US$26 million, comprising an initial US$6 million investment and an additional US$20 million option.

How will LOBEF use the initial US$6 million private placement proceeds?

The proceeds will fund additional preclinical research, IND enabling studies, Phase 1, and Phase 2a clinical studies for Conjugated Psilocin™.

What percentage of Cynaptec will Lobe Sciences (LOBEF) own after the initial investment?

Lobe Sciences will own 64% of Cynaptec's issued and outstanding shares after the initial investment.

What happens to LOBEF's ownership if the US$20 million option is exercised?

If the option is fully exercised, the investor would own 68% of Cynaptec, reducing Lobe Sciences' ownership to 32%.

What clinical milestones must LOBEF achieve before the investor can exercise the US$20M option?

The company must complete preclinical and Phase 1 Single Ascending Dose programs, plus a Proof of Concept study for headache impact assessment.